December 7, 2010

The Uncertainty Canard

Republicans have spent two years chanting that "uncertainty" is responsible for the problems of the economy. How can business plan for the future when they don't know what their tax rates will be?

The current tax fight was a perfect experimental study of the party's actual commitment to that principle. Republicans wanted to end uncertainty by making the Bush tax cuts permanent. Democrats wanted to end uncertainty by making the tax cut on income below $250,00 permanent, while returning to Clinton-era tax rates on the rich. Neither had the votes for a permanent victory.

So, Republicans had a choice. They could accede to certainty with Clinton-era rates on the rich, or uncertainty with Bush-era rates on the rich. They chose uncertainty. The Bush-era rates will live on for two years, after which nobody knows if they'll be extended or not.

For those still clinging to any naive notion that Republicans meant this as anything more than a slogan, the answer is now clear. They want low tax rates for the rich. They don't care about certainty.